In this review: Petrol versus diesel? Which fuel has the most consumer merit? Efficiency of petrol compared to the efficiency of diesel. Petrol, diesel and greenhouse. Ownership and operating costs of petrol and diesel cars. Retained value versus operating costs. Which fuel is greenest? Are modern diesels economically rational? Consumer advice.

Diesel car sales have for years propped up a stagnant Australian passenger car market. In both the ‘private’ and ‘business/government/fleet’ sectors, petrol was responsible for the overwhelming bulk of the passenger car action – but petrol car sales have gone nowhere-to-backwards since 2005.

Diesel sales – we’re talking passenger cars here, not SUVs, 4X4s, light commercials or trucks – have grown more strongly than anything else, including dual-fuel LPG and hybrids. This growth has occurred from a considerably greater base than hybrids or LPGs, too, and in the absence of a government handout (former Prime Minister John Howard’s LPG subsidy remains in effect today).

FINANCES & SALES

There are two key hip-pocket hurdles, which diesel cars appear largely to have overcome. First, they are both considerably more expensive up front ($2500 on average). Second, the fuel is pricier – generally 7-10 cents more than 91RON ULP. However, the disparity fluctuates off the back of macroeconomic factors, like global economic prosperity (which drives the price of diesel north).

Despite this, private punters bought almost four times as many diesel passenger cars in 2008 as they did in 2005. Sales have risen from just over 5000 units to almost 20,000. The total passenger car market to private buyers is flat – almost 330,000 units in 2005; nearly 324,000 units in 2008.

If mums, dads and DINKs have embraced diesel cars, fleet and business have become infatuated. Since 2005, sales have skyrocketed almost nine-fold – from just under 2000 units to 16,479 in 2008.

Total, diesel passenger car sales have grown five-fold since 2005, jumping from just over 7000 units to more than 36,000. In the same time, Hybrids – the darling of the ‘green car’ set – posted less dramatic growth, in absolute and percentage terms. Hybrid sales grew by 170 per cent, from 1604 units to 4448 units – the latter comprising a miniscule share (0.75 per cent) of the passenger car market.

Some manufacturers have benefitted hugely. Take the Volkswagen group. Volkswagen sales grew from almost 16,000 units in 2005 to almost 30,000 in 2008, and its market share basically doubled. (Today it’s three per cent of the market.) Audi, too, has ridden to success in part off the back of its commitment to diesel. Its sales and market share have also nearly doubled in the same timeframe (from 4800 units and 0.5 per cent, to 9410 units and 0.9 per cent).

The meteoric rise of diesel is hardly based on novelty. By 2005, Australia had had Euro 4-compliant ‘ultra-low sulphur’ diesel for five years. We adopted the EU4 fuel standard late, in world terms, in 2000. The move opened the floodgates for many (especially European) cars already available elsewhere, but which were previously off-limits here. (Before 2000, our diesel had 10 times more sulphur in it than it does today.) Diesel cars were already very common here by 2005, and a very successful series of ‘green’ marketing campaigns underpins them. And continues to do so.

With diesel sales gaining momentum, the obvious question is: should you buy one next? Let’s find out by following two contenders – a Volkswagen Golf and an Hyundai i30 over a theoretical three-year ‘average’ ownership experience in both petrol and diesel forms.

ECONOMICS

Diesel versus petrol analyses are often couched in terms of a break-even point – the distance you have to drive to break even on price. It’s not the best way to do it, as most new cars are financed. It’s better to add up the repayments, the projected fuel and the disposal costs. When you do that, the ownership-cost issue is basically too close to call. The i30 ownership costs (petrol Vs diesel) are a photo-finish. Even for the Golf – an $860 disparity, with petrol in front, despite the 1.6 slurping 95RON – amounts to just $5.50 per week. Less than the cost of a daily newspaper.

The cost of servicing is almost impossible to quantify, but anecdotally, diesels are a little more expensive here. That’s not taken into account in the table.

What this means is, of course, that the decision to own a diesel is not really cost-based. It depends how you feel about the environment and performance – and whether you want your hands reeking of diesel every time you fill up, after queuing behind three trucks for a pump you’ve had trouble locating.

GREENHOUSE

Diesel is significantly in front in greenhouse terms. Over three years of motoring you’ll emit one tonne less CO2 if you tick the ‘diesel’ box when you buy a Golf, and nearly double that saving when you buy an i30. It’s a reduction of 13 per cent for the Golf (compared with the petrol) and 26 per cent for the Hyundai. Compared to the average Aussie car ‘out there’ on Australian roads (emitting almost four tonnes of CO2 annually) the potential greenhouse reduction from modern diesel engines is staggering.

PERFORMANCE

Both Hyundai’s and Volkswagen’s diesels offer considerably more torque than their petrol counterparts. And they do it lower in the rev range, where it’s generally more accessible. The diesel Golf is cleverly specified to offer the same power output as the petrol, albeit at lower revs. The petrol Hyundai still wins in the power stakes, and so will undoubtedly offer more absolute performance (at wide-open throttle and high revs). However, most people don’t spend all that much time driving like that.

Torque is king of the real world, so rather than get all twisted over paying a premium for a diesel engine, perhaps it’s better to think in terms of paying a premium for diesel’s increased engine output. The entry-level Camry is $28,490. It produces 218Nm. The same thing in Aurion-spec is $34,990. It makes 336Nm, an increase of 118Nm, or 50-odd per cent. Most people don’t have a problem with the $5500 premium in that case, yet many still bitch and moan over the premium charged for diesel, when the real-world driving benefit is actually better.

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